It is not good news for us as employees as the Employees Provident Fund (EPF) is considering realigning its members’ withdrawal age for retirement savings closer towards the retirement age at 60.
EPF CEO, Datuk Shahril Ridza Ridzuan ssaid the country had to address the issue of withdrawal at 55 versus the new retirement age at 60, otherwise it would be a burden to the society to manage people who are retiring without enough money in their accounts.
He said that based on research conducted by economist showed the average people tend to exhaust their retirement savings within three to five years after making full withdrawal.
He said EPF recommended an amount of at least RM196,800 upon retirement, statistics showed that only 22 percent of active 54 year old contributors met this minimum last year.
To make worst, 68 percent of all EPF members of the same age had less than RM50,000 in their accounts.
Information from the EPF’s report showed that the basic savings is set at RM196,800 to give a monthly income of RM820 for 20 years until age 75.
It also stated that based on the retirement age for Malaysians of 60 years, and the life expectancy of 72.6 years for men and 77.2 years for women, the total savings (RM196,800) would require a retiree to survive on just RM700 a month for the rest of his or her life.
The minimum retirement age in Malaysia was raised to 60 years in 2013. However, the permissable age for EPF members to withdraw their savings remains at 55 years.
The EPF said it had a pilot project aimed at increasing knowledge on basic financial and retirement planning by offering a retirement advisory service at its two branches in Kuala Lumpur and Petaling Jaya. — Bernama
// In my opinion, I’m disagree with the realign withdrawal age from 55 to 60. It won’t effect much if the person not have retirement knowledge. The important thing is to educate them where to invest before their retirement. To push withdrawal age just make their life worst. Some of them get on working even in their retirement age.